This question is specific to portfolio loans. I've seen the topic discussed on these threads before, but not specific to this situation:

Our bank locks portfolio mortgage loan rates with a rate lock form similar to the secondary market. We issue the GFE based on that rate, and in block three of the GFE show the mandatory information.

If that rate lock period expires and we haven't closed, we are going to honor the rate anyway. We don't formally extend it or relock it. For example, rate lock period expires 4/18 but the loan doesn't close until 4/29. Same rate, same terms, same fees, but no formal agreement of any type.

Do we need to reissue the GFE upon rate expiration with N/A in block 3, since technically the rate is no longer locked? Do we need to run the APOR spread test again using the date of the reissued GFE?

What I've seen mentioned on these threads is that if you extend or relock a rate, you definitely need to reissue the GFE. I haven't seen an answer to the question what do you do if the rate lock expires and no action is taken at all, but the loan still closes under the same terms.

Thanks for any help.

Whether the loan closes under the same terms is up to the bank. There is no requirement to re-issue a GFE when the lock expires. As far as the APOR, that is based on the last time the rate is set. If you didn't reset the rate before closing, you would still use the previous date.

Excellent news. Thanks!

And even better news -- this isn't going to change under the TRID rules in August.

On the other hand, if the rate lock is extended, would a new GFE or Loan Estimate be required? My understanding was that the only time we MUST re-disclose the GFE or Loan Estimate is at a rate lock event.

Currently, a new GFE is required at rate lock. An extension is considered a rate lock so a new GFE, showing the corrected/extended dates, must be issued. I believe this holds true in the land of LEs too.

Even if the only thing changing on the lock is the expiration date?

Yes, even if .... because that's a key item on the LE.

Thank you for confirming. I guess we have always extended rates when they expire, but based on the discussion above it sounds like a rate lock need not be extended at a cost to the borrower for portfolio loans? The bank could stick with the quoted rate or go with the market rate at the time. I guess I never considered that. Are their any implications to not extending a rate lock?

That will depend upon your bank. Some banks lock rates and charge fees as part of interest rate risk management.

What if we have a changed circumstance? Should the important date section remain the same or reflect new dates?

Our situation includes a GFE issued on March 16 and the rate lock period (which we don't loack rates) has expired. The changed circumstance came on April 27. Our important dates section ended on April 16.

Should we start over? Help

If you don't lock rates, how could the rate lock period expire?
What changed circumstance happened on April 27?